Since the establishment of the commercial airline industry there have been two key players when it comes to the manufacturing of aircrafts. Both Airbus and Boeing have been ruling this industry for the last four decades, in which they have always attempted to achieve a competitive advantage over the opponent.Airbus has now achieved this with the invention of the Airbus A380. “The A380 also reinforces Airbus’ reputation for technological leadership with 25 per cent composites in its structure, new generation engines using 12 per cent less fuel to carry 35 per cent more passengers further, half the noise energy at take-off and 15 -20 per cent lower operating costs than its nearest competitor.” (Airbus, 2005)This aircraft will bring entirely new dimensions into this industry by being able to carry up to eight hundred passengers at one time.
“Through detailed analyses of 140 individual passenger travel markets, Airbus forecasters predict that traffic will triple over the next 20 years.” (Airbus, 2005)If these results become reality, the Airbus A380 is the future of the airline industry, and we will be seeing more and more of these ‘flagships.’ Not only is the airbus larger in terms of seating capacity, it also has numerous new features.Some of the attributes of the A380 are for example a sky which will be projected on the ceiling of the first class that automatically adapts to current time zone the plane is flying through. (Lufthansa, 2006)When planning a project that will cost more than 12 billion Euros, a strategy has to be used to make this a profitable investment for the company.
In Airbus’s case this strategy is call the ‘Hub and Spoke System.’“A system of air transportation in which local airports offer air transportation to a central airport where long-distance flights are available” (Anonymous 1a, 2006) (IATA, 2006)Airbus is only facing one problem, the problem of delivering on time. This is a problem that has caused Airbus to reevaluate the entire production of the A380. Since the beginning of production there have been two official delay announcements made by Airbus.Both have been for at least a six to seven month time period. This delay in delivery has caused a lot of negative discussion and many questions have been asked.
Airbus has partly restructured this project and has publicized new delivery dates that need to be held this time around before airlines start canceling orders. Therefore this reconstruction plan needs to be well thought out and implemented from the second the last delay was announced in October 2006.Airbus is not only facing the fear of cancelled orders, the company is also closely watching the tough competition by Boeing. Boeing is in the middle of producing the B787 ‘Dreamliner’ which will be a fuel efficient, long haul (up to 16,000 kilometers non stop), 280 passenger plane which will hit the market in 2008. (Boeing, 2006)On top of that Airbus is suffering from the weaker U.
S. dollar “which hits revenue in euros from dollar denominated jet sales.” (International Business Times, 2006)All of these factors are hurting Airbus on a daily basis, and unless this reconstruction plan has been thought out to perfection the A380 could be the last plane Airbus ever builds.
